Proposed Collection; Comment Request, 34110-34111 [2011-14390]

Download as PDF 34110 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices investment companies that issue redeemable securities (‘‘funds’’) an exemption from section 22(d) of the Investment Company Act (15 U.S.C. 80a–22(d)) to the extent necessary to permit scheduled variations in or elimination of the sales load on fund securities for particular classes of investors or transactions, provided certain conditions are met. The rule imposes an annual burden per series of a fund of approximately 15 minutes, so that the total annual burden for the approximately 4862 series of funds that might rely on the rule is estimated to be 1215.5 hours. The estimate of average burden hours is made solely for the purposes of the Paperwork Reduction Act, and is not derived from a comprehensive or even a representative survey or study. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. Written comments are requested on: (a) Whether the collection of information is necessary for the proper performance of the functions of the Commission, including whether the information has practical utility; (b) the accuracy of the Commission’s estimate of the burden(s) of the collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. Please direct your written comments to Thomas Bayer, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way, Alexandria, VA 22312; or send an email to: PRA_Mailbox@sec.gov. Dated: June 6, 2011. Cathy H. Ahn, Deputy Secretary. [FR Doc. 2011–14392 Filed 6–9–11; 8:45 am] WReier-Aviles on DSKGBLS3C1PROD with NOTICES BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Jkt 223001 Notice is hereby given that, pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (‘‘Commission’’) is soliciting comments on the collections of information summarized below. The Commission plans to submit these existing collections of information to the Office of Management and Budget (‘‘OMB’’) for extension and approval. Section 32(a)(2) of the Investment Company Act (15 U.S.C. 80a–31(a)(2)) requires that shareholders of a registered investment management or face-amount certificate company (collectively, ‘‘funds’’) ratify or reject the selection of the fund’s independent public accountant. Rule 32a–4 (17 CFR 270.32a–4) exempts funds from this requirement if (i) The fund’s board of directors establishes an audit committee composed solely of independent directors with responsibility for overseeing the fund’s accounting and auditing processes,1 (ii) the fund’s board of directors adopts an audit committee charter setting forth the committee’s structure, duties, powers and methods of operation, or sets forth such provisions in the fund’s charter or bylaws,2 and (iii) the fund maintains a copy of such an audit committee charter, and any modifications to the charter, permanently in an easily accessible place.3 Each fund that chooses to rely on rule 32a–4 incurs two collection of information burdens. The first, related to the board of directors’ adoption of the audit committee charter, occurs once, when the committee is established. The second, related to the fund’s maintenance and preservation of a copy of the charter in an easily accessible place, is an ongoing annual burden. The information collection requirement in rule 32a–4 enables the Commission to monitor the duties and responsibilities of an independent audit committee formed by a fund relying on the rule. Commission staff estimates that, on average, the board of directors takes 15 minutes to adopt the audit committee charter. Commission staff has estimated that with an average of 8 directors on the board,4 total director time to adopt 32a–4(a). 32a–4(b). 3 Rule 32a–4(c). 4 This estimate is based on staff discussions with a representative of an entity that surveys funds and calculates fund board statistics based on responses to its surveys. 2 Rule Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Investor 14:33 Jun 09, 2011 Extension: Rule 32a–4; SEC File No. 270–473; OMB Control No. 3235–0530. 1 Rule Proposed Collection; Comment Request VerDate Mar<15>2010 Education and Advocacy, Washington, DC 20549. PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 the charter is 2 hours. Combined with an estimated 1 hour of paralegal time to prepare the charter for board review, the staff estimates a total one-time collection of information burden of 3 hours for each fund. Once a board adopts an audit committee charter, a fund generally maintains it in a file cabinet or as a computer file. Commission staff has estimated that there is no annual hourly burden associated with maintaining the charter in this form.5 Because virtually all funds extant have now adopted audit committee charters, the annual one-time collection of information burden associated with adopting audit committee charters is limited to the burden incurred by newly established funds. Commission staff estimates that fund sponsors establish approximately 117 new funds each year,6 and that all of these funds will adopt an audit committee charter in order to rely on rule 32a–4. Thus, Commission staff estimates that the annual one-time hour burden associated with adopting an audit committee charter under rule 32a–4 going forward will be approximately 351 hours.7 As noted above, all funds that rely on rule 32a–4 are subject to the ongoing collection of information requirement to preserve a copy of the charter in an easily accessible place. This ongoing requirement, which Commission staff has estimated has no hourly burden, applies to new funds that adopt an audit committee charter each year and to all funds that have previously adopted the charter and continue to maintain it. When funds adopt an audit committee charter in order to rely on rule 32a–4, they also may incur one-time costs related to hiring outside counsel to prepare the charter. Commission staff estimates that those costs average approximately $1500 per fund.8 5 No hour burden related to such maintenance of the charter was identified by the funds the Commission staff surveyed. Commission staff understands that many audit committee charters have been significantly revised after their adoption in response to the Sarbanes-Oxley Act (Pub. L. 107– 204, 116 Stat. 745) and other developments. However, the costs associated with these revisions are not attributable to the requirements of rule 32a– 4. 6 This estimate is based on the number of Form N–8As filed from January 2010 through December 2010. 7 This estimate is based on the following calculation: (3.0 burden hours for establishing charter × 117 new funds = 351 burden hours). 8 Costs may vary based on the individual needs of each fund. However, based on the staff’s conversations with outside counsel that prepare these charters, legal fees related to the preparation and adoption of an audit committee charter usually average $1500 or less. The Commission also understands that the ICI has prepared a model audit committee charter, which most legal professionals E:\FR\FM\10JNN1.SGM 10JNN1 WReier-Aviles on DSKGBLS3C1PROD with NOTICES Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices Commission staff understands that virtually all funds now rely on rule 32a– 4 and have adopted audit committee charters, and thus estimates that the annual cost burden related to hiring outside legal counsel is limited to newly established funds. As noted above, Commission staff estimates that approximately 117 new funds each year will adopt an audit committee charter in order to rely on rule 32a–4. Thus, Commission staff estimates that the ongoing annual cost burden associated with rule 32a–4 in the future will be approximately $175,500.9 The estimates of average burden hours and costs are made solely for the purposes of the Paperwork Reduction Act, and are not derived from a comprehensive or even a representative survey or study of the costs of Commission rules and forms. The collections of information required by rule 32a–4 are necessary to obtain the benefits of the rule. The Commission is seeking OMB approval, because an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. Written comments are invited on: (a) Whether the collection of information is necessary for the proper performance of the functions of the Commission, including whether the information has practical utility; (b) the accuracy of the Commission’s estimates of the burdens of the collections of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burdens of the collections of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. Please direct your written comments to Thomas Bayer, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way, Alexandria, VA 22312; or send an email to: PRA_Mailbox@sec.gov. use when establishing audit committees, thereby reducing the costs associated with drafting a charter. 9 This estimate is based on the following calculations: ($1500 cost of adopting charter × 117 newly established funds = $175,500). VerDate Mar<15>2010 14:33 Jun 09, 2011 Jkt 223001 Dated: June 6, 2011. Cathy H. Ahn, Deputy Secretary. [FR Doc. 2011–14390 Filed 6–9–11; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64604; File No. SR–FICC– 2011–04] Self-Regulatory Organizations; Fixed Income Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Permit Brokers To Process Specified Pool Trade Activity at the Mortgage-Backed Securities Division in Broker Accounts June 6, 2011. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 notice is hereby given that on May 31, 2011, the Fixed Income Clearing Corporation (‘‘FICC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change described in Items I, II, and III below, which Items have been prepared primarily by FICC. FICC filed the proposal pursuant to Section 19(b)(3)(A) of the Act 2 and Rule 19b– 4(f)(4) 3 thereunder so that the proposal was effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the rule change from interested parties. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change will permit brokers to process specified pool trade (‘‘SPT’’) activity at the Mortgage-Backed Securities Division (‘‘MBSD’’) in broker accounts. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, FICC included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. FICC has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of these statements.4 U.S.C. 78s(b)(1). U.S.C. 78s(b)(3)(A). 3 17 CFR 240.19b–4(f)(4). 4 The Commission has modified the text of the summaries prepared by FICC. 34111 (A) Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change The purpose of this proposed rule change is to implement certain technical enhancements necessary to permit brokers to process SPT activity at MBSD in their broker accounts. SPT activity is currently processed by brokers in their dealer accounts. MBSD’s systems do not currently permit processing of SPT activity in broker accounts. If, after a broker submits an SPT through its dealer account the dealer counterparty submits the other side of the transaction against the broker’s broker account (instead of the broker’s dealer account), the dealer is required to make a correction to trade input to reflect the correct account. By permitting brokers to process SPT activity in their broker accounts, the proposed change would eliminate a cause of the corrections to trade input and thereby improve efficiency and reduce operational risk. The proposed change enhances FICC’s existing services and does not eliminate any of FICC’s existing services.5 FICC will notify members of the effective date of the proposed rule change by Important Notice. FICC believes that the proposed rule change is consistent with the requirements of Section 17A of the Act 6 and the rules and regulations thereunder applicable to FICC because it is designed to promote the prompt and accurate clearance and settlement of securities transactions by enhancing an existing service offering and eliminating a cause of corrections to trade input. (B) Self-Regulatory Organization’s Statement on Burden on Competition FICC does not believe that the proposed rule change will have any impact or impose any burden on competition. (C) Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments relating to the proposed rule change have not yet been solicited or received. FICC will notify the Commission of any written comments received by FICC. 1 15 2 15 PO 00000 Frm 00081 Fmt 4703 Sfmt 4703 5 MBSD will continue to support the processing of SPT activity in dealer accounts. 6 15 U.S.C. 78q–1. E:\FR\FM\10JNN1.SGM 10JNN1

Agencies

[Federal Register Volume 76, Number 112 (Friday, June 10, 2011)]
[Notices]
[Pages 34110-34111]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-14390]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of Investor Education and Advocacy, Washington, DC 
20549.
Extension:
    Rule 32a-4; SEC File No. 270-473; OMB Control No. 3235-0530.

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') is soliciting comments on the collections 
of information summarized below. The Commission plans to submit these 
existing collections of information to the Office of Management and 
Budget (``OMB'') for extension and approval.
    Section 32(a)(2) of the Investment Company Act (15 U.S.C. 80a-
31(a)(2)) requires that shareholders of a registered investment 
management or face-amount certificate company (collectively, ``funds'') 
ratify or reject the selection of the fund's independent public 
accountant. Rule 32a-4 (17 CFR 270.32a-4) exempts funds from this 
requirement if (i) The fund's board of directors establishes an audit 
committee composed solely of independent directors with responsibility 
for overseeing the fund's accounting and auditing processes,\1\ (ii) 
the fund's board of directors adopts an audit committee charter setting 
forth the committee's structure, duties, powers and methods of 
operation, or sets forth such provisions in the fund's charter or 
bylaws,\2\ and (iii) the fund maintains a copy of such an audit 
committee charter, and any modifications to the charter, permanently in 
an easily accessible place.\3\
---------------------------------------------------------------------------

    \1\ Rule 32a-4(a).
    \2\ Rule 32a-4(b).
    \3\ Rule 32a-4(c).
---------------------------------------------------------------------------

    Each fund that chooses to rely on rule 32a-4 incurs two collection 
of information burdens. The first, related to the board of directors' 
adoption of the audit committee charter, occurs once, when the 
committee is established. The second, related to the fund's maintenance 
and preservation of a copy of the charter in an easily accessible 
place, is an ongoing annual burden. The information collection 
requirement in rule 32a-4 enables the Commission to monitor the duties 
and responsibilities of an independent audit committee formed by a fund 
relying on the rule.
    Commission staff estimates that, on average, the board of directors 
takes 15 minutes to adopt the audit committee charter. Commission staff 
has estimated that with an average of 8 directors on the board,\4\ 
total director time to adopt the charter is 2 hours. Combined with an 
estimated 1 hour of paralegal time to prepare the charter for board 
review, the staff estimates a total one-time collection of information 
burden of 3 hours for each fund. Once a board adopts an audit committee 
charter, a fund generally maintains it in a file cabinet or as a 
computer file. Commission staff has estimated that there is no annual 
hourly burden associated with maintaining the charter in this form.\5\
---------------------------------------------------------------------------

    \4\ This estimate is based on staff discussions with a 
representative of an entity that surveys funds and calculates fund 
board statistics based on responses to its surveys.
    \5\ No hour burden related to such maintenance of the charter 
was identified by the funds the Commission staff surveyed. 
Commission staff understands that many audit committee charters have 
been significantly revised after their adoption in response to the 
Sarbanes-Oxley Act (Pub. L. 107-204, 116 Stat. 745) and other 
developments. However, the costs associated with these revisions are 
not attributable to the requirements of rule 32a-4.
---------------------------------------------------------------------------

    Because virtually all funds extant have now adopted audit committee 
charters, the annual one-time collection of information burden 
associated with adopting audit committee charters is limited to the 
burden incurred by newly established funds. Commission staff estimates 
that fund sponsors establish approximately 117 new funds each year,\6\ 
and that all of these funds will adopt an audit committee charter in 
order to rely on rule 32a-4. Thus, Commission staff estimates that the 
annual one-time hour burden associated with adopting an audit committee 
charter under rule 32a-4 going forward will be approximately 351 
hours.\7\
---------------------------------------------------------------------------

    \6\ This estimate is based on the number of Form N-8As filed 
from January 2010 through December 2010.
    \7\ This estimate is based on the following calculation: (3.0 
burden hours for establishing charter x 117 new funds = 351 burden 
hours).
---------------------------------------------------------------------------

    As noted above, all funds that rely on rule 32a-4 are subject to 
the ongoing collection of information requirement to preserve a copy of 
the charter in an easily accessible place. This ongoing requirement, 
which Commission staff has estimated has no hourly burden, applies to 
new funds that adopt an audit committee charter each year and to all 
funds that have previously adopted the charter and continue to maintain 
it.
    When funds adopt an audit committee charter in order to rely on 
rule 32a-4, they also may incur one-time costs related to hiring 
outside counsel to prepare the charter. Commission staff estimates that 
those costs average approximately $1500 per fund.\8\

[[Page 34111]]

Commission staff understands that virtually all funds now rely on rule 
32a-4 and have adopted audit committee charters, and thus estimates 
that the annual cost burden related to hiring outside legal counsel is 
limited to newly established funds.
---------------------------------------------------------------------------

    \8\ Costs may vary based on the individual needs of each fund. 
However, based on the staff's conversations with outside counsel 
that prepare these charters, legal fees related to the preparation 
and adoption of an audit committee charter usually average $1500 or 
less. The Commission also understands that the ICI has prepared a 
model audit committee charter, which most legal professionals use 
when establishing audit committees, thereby reducing the costs 
associated with drafting a charter.
---------------------------------------------------------------------------

    As noted above, Commission staff estimates that approximately 117 
new funds each year will adopt an audit committee charter in order to 
rely on rule 32a-4. Thus, Commission staff estimates that the ongoing 
annual cost burden associated with rule 32a-4 in the future will be 
approximately $175,500.\9\
---------------------------------------------------------------------------

    \9\ This estimate is based on the following calculations: ($1500 
cost of adopting charter x 117 newly established funds = $175,500).
---------------------------------------------------------------------------

    The estimates of average burden hours and costs are made solely for 
the purposes of the Paperwork Reduction Act, and are not derived from a 
comprehensive or even a representative survey or study of the costs of 
Commission rules and forms.
    The collections of information required by rule 32a-4 are necessary 
to obtain the benefits of the rule. The Commission is seeking OMB 
approval, because an agency may not conduct or sponsor, and a person is 
not required to respond to, a collection of information unless it 
displays a currently valid control number.
    Written comments are invited on: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
the Commission, including whether the information has practical 
utility; (b) the accuracy of the Commission's estimates of the burdens 
of the collections of information; (c) ways to enhance the quality, 
utility, and clarity of the information collected; and (d) ways to 
minimize the burdens of the collections of information on respondents, 
including through the use of automated collection techniques or other 
forms of information technology. Consideration will be given to 
comments and suggestions submitted in writing within 60 days of this 
publication.
    Please direct your written comments to Thomas Bayer, Director/Chief 
Information Officer, Securities and Exchange Commission, c/o Remi 
Pavlik-Simon, 6432 General Green Way, Alexandria, VA 22312; or send an 
e-mail to: PRA_Mailbox@sec.gov.

    Dated: June 6, 2011.
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-14390 Filed 6-9-11; 8:45 am]
BILLING CODE 8011-01-P